Gold Pops To One-Week High With Conflict, M&A At Forefront

By Grace L. Williams

Gold for June delivery settled at a one-week high of $1,290.60 an ounce after slipping as low as $1,268.40.

The metal continues to endure pricing ups and downs related to the ongoing conflict between Russia and Ukraine. Most recently, prices had fallen below $1,280 at when Russia announced it would launch military exercises near the Ukraine border for recent clashes that left at least five pro-Russian activists killed. (Gold closed up for the first time in four trading sessions Wednesday).

PerMarketWatch, Naeem Aslam, chief market analyst at AvaTrade, noted that if Russia follows through, a further commodities selloff is to be expected to follow suit. Aslam continues, “gold could be the biggest beneficiary of this situation and in no time we could be back above the $1,300 level.”

Elsewhere, analyst Patrick Chidley of HSBC released a note today concerning global gold equities. Chidley opined that while gold recently found a pricing floor, some of the news du jour pertains to the M&A front, writing, “Perhaps signaling gold’s nadir, a bidding war for mid-tier Osisko Mining (OSK) ended up with a knock out combo bid from Yamana and Agnico Eagle, Mines (AEM) acquiring Osisko. Press reports of a potential merger deal between Barrick Gold (ABX) and Newmont Mining (NEM) indicate that M&A activity in the sector is heating up and Sibanye Gold (SBGL) may be looking at potential M&A in the South African platinum sector.”

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